[2024 Alternative Investment Forum] Chairman Kim Taehyun: "We Will Discover High-Yield Alternative Sectors to Improve Fund Returns"

Setting Operational Directions and Execution from a Long-Term Perspective
Opening of the 4th Overseas Office in San Francisco, USA
Discovering New Investment Opportunities... Efforts to Improve Profitability

Kim Tae-hyun, Chairman of the National Pension Service, is delivering a congratulatory speech at the '2nd Asia Economy Alternative Investment Forum' held on the 12th at the Conrad Hotel in Yeouido, Seoul. Photo by Kang Jin-hyung aymsdream@

Hello. I am Kim Tae-hyun, Chairman of the National Pension Service. I sincerely congratulate the 2nd Asia Economy 'Alternative Investment Forum'.

First, I would like to thank Chairman Hyun Sang-soon of Asia Economy and all the related personnel for organizing this event. I also warmly greet all attendees, including Chairman Seo Yoo-seok of the Korea Financial Investment Association, who delivered the congratulatory remarks.

Although this is only the second forum following last year, it has established itself as a major event attended by over 150 domestic and international financial and economic experts despite its short history. I hope that Asia Economy's Alternative Investment Forum will continue to be Korea's representative alternative investment forum that shares in-depth strategies and explores diverse investment opportunities.

Distinguished guests! Recently, the domestic and international economic and financial environment has become more uncertain and volatile compared to the beginning of the year due to heightened geopolitical risks in the Middle East and concerns about a recession in the United States. The policy responses of various countries to these issues have led institutional investors and companies to focus on securing new growth engines.

I believe the theme of today's forum, 'Global Alternative Investment Trends and Korea's Opportunity Creation (K-Value Up),' reflects these contemporary demands. As a long-term investor managing the retirement funds of the people, the National Pension Fund prioritizes setting and steadily executing its management direction from a long-term perspective rather than reacting sensitively to short-term market conditions.

The National Pension Service has continuously sought promising overseas and alternative asset investment opportunities within tolerable risk limits while maintaining thorough risk management.

In the private equity sector, this September, we plan to select three delegated asset managers with a total scale of 350 billion KRW to provide investment opportunities in credit and distressed assets to companies with excellent capabilities but temporarily constrained financing.

In the real estate sector, for the first time since the establishment of the Fund Headquarters, we plan to select two delegated asset managers for real estate debt funds totaling 600 billion KRW in November this year. This aims to increase stable domestic commercial real estate loan exposure while achieving appropriate returns in a high-interest market environment.

Most importantly, following the resolution by the Fund Management Committee in May to introduce a benchmark portfolio starting with the alternative sector next year, the Fund Management Headquarters now has much greater autonomy to choose and utilize new investment methods in alternative sectors such as private equity funds (PEF), real estate, and infrastructure.

Last week, we opened the National Pension Service's fourth overseas office in San Francisco, USA, a hub of financial and technological innovation. This is part of our efforts to discover promising investment opportunities. The overseas office will play a crucial role in securing the latest investment information from the global economic and financial markets, communicating and cooperating with leading global companies locally, and identifying new investment opportunities.

Alongside this, to enhance the fund's long-term returns, the National Pension Service continues to implement strategies investing in companies undervalued relative to their intrinsic value by focusing on valuation-based corporate analysis and identifying companies dedicated to enhancing shareholder value, using these insights in investment decisions.

In March this year, we selected three 'domestic equity value-type delegated asset managers' and invested a total of 600 billion KRW to discover and invest in companies striving to enhance shareholder and corporate value.

To improve corporate value for domestic equity delegated asset managers managing 81 trillion KRW of the National Pension Fund, we have specified in the domestic equity delegated investment guidelines from this year the investment principle of 'investing in listed companies that enhance shareholder and corporate value.' We also plan to reflect efforts to enhance corporate value, such as dividends and appropriate capital utilization, in responsible investment-type delegated funds.

Distinguished guests! Public interest in National Pension reform and fund management returns is higher than ever. The National Pension Fund will devote all efforts to improving fund returns by continuously discovering profitable alternative sectors and diversifying investment targets within asset classes.

I hope today's forum on the theme of 'Global Alternative Investment Trends and Korea's Opportunity Creation' will be a valuable time to gather the experience and wisdom of experts from various fields and explore diverse investment opportunities.

Once again, congratulations on the hosting of the 2nd Asia Economy Alternative Investment Forum. Thank you.